Finance & Business World

Cal Expo and the National Basketball Association agreed Wednesday to proceed with exploring a joint redevelopment of the fairgrounds that would include a new arena, commercial space and housing.

Now the Cal Expo board and NBA will determine what the project might look like, how it would be funded and which developers might want to participate.

The letter of understanding that Cal Expo and NBA commissioner David Stern signed Wednesday afternoon doesn't obligate either party to actually proceed with any project on the 360-acre grounds. Instead, it is the next step toward preparing a request for proposal to obtain the third critical player — a developer or developers that would deliver the private funds necessary to redevelop the fairgrounds.

Community leaders, residents and basketball fans went before Cal Expo board members Wednesday to urge them to proceed with researching the project.

Several board members, including ex-officio member Assemblyman Dave Jones, expressed concerns about the amount of money Cal Expo might need to spend on consultants as it continues looking into the proposal. The board will keep employing the services of former Gov instant cash advance. Pete Wilson and other consultants from Bingham Consulting Group.

Whatever might get built on the fairgrounds would remain the property of the state, said Norb Bartosik, Cal Expo general manager. New buildings, including an arena, would be operated under long-term leases.

John Moag, consultant to the NBA, said he had no estimate for the cost of a new arena. Earlier preliminary estimates not based on this site were around $500 million, he noted.

Moag said he's spoken to developers who, without being solicited, are interested in participating in a project at Cal Expo. He described it as "substantial interest from substantial players."

The fairgrounds are "so well positioned," with 360 acres close to downtown, that developers will surely respond, Wilson said.

Still, Wilson said, "this is an ambitious undertaking" and one that is "not easily accomplished."

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